UPS Store profit margin

Discussion in 'UPS Discussions' started by Dfigtree, Jul 17, 2009.

  1. Dfigtree

    Dfigtree New Member

    So I went to my local UPS store and as usual asked for a 10% UPSer's discount. The owner said he no longer can honor that discount because he has so little room for profit.
  2. freeloader

    freeloader geek

    Isn't that the basis for the class action lawsuit in California? MBE franchisee's being forced by UPS to convert from an existing profitable business model to a new less profitable business model?
  3. BrownSuit

    BrownSuit Active Member

    That's a discount arranged at the corporate level and required that all franchises abide by. He can either give you the discount or be reported.

    There are a number of stores that feel that they don't answer to anybody and can do whatever they want.

    There is litigation pending after lawyers got a hold of some internal memos (google UPS Store and Norman Black). In my opinion, the accusation that UPS took something profitable and killed it is garbage. The study at the basis of the suit did find that they would have trouble maintaining profitability.

    I think this is more related to the trend away from these establishments, the changing competitive landscape and the role that pack and ship stores play overall. Keep in mind we are deterring conversion of UPS Store customers through SLIM leads and our sales-force.

    Also the study was conducted some time ago, but you have to wonder what the economy is doing to the UPS Stores. I keep seeing signs about giving away 1 month free for every 3 months rentals, thats 25% off.
  4. Jim Kemp

    Jim Kemp Active Member

    In our area the UPS sups use the UPS store like THEY own them. We are always told to go leave your pick ups at "THE UPS STORE". Go leave your misloads at THE UPS STORE. we get diad messages,You have some extra stops at Yes, THE UPS STORE.

    The owners have complained to me about it and I tell them to tell them NO. but they won't.
  5. sano

    sano New Member

    I don't know anything about the UPS store contract or changes in their contract.
    Just a general observation though, It seem many franchise systems have lawsuits against them. There is lots of opportunities for misunderstandings in these agreements.

    I think the UPS store needs to look at the fedex office business model, but that is a thread for another day.
  6. JonFrum

    JonFrum Member

    UPS forces its UPS Stores to give a discount, but UPS itself gives no discount???
  7. MonavieLeaker

    MonavieLeaker Bringin Teh_Lulz

    Bout par for the course for UPS
  8. bluehdmc

    bluehdmc Well-Known Member

    The discount is not for shipping, it's only for stuff like copying, etc. (not sure about mailbox rental)
  9. TheDick

    TheDick Member

  10. Mike23

    Mike23 Guest

    Since we're talking about UPS stores, I did some time in ECS when I was having back spasms. This is the really stupid part about the stores (other then us letting them go independent and confusing EVERYBODY).

    If a customer wants to pick something up at the UPS store the CUSTOMER has to call the UPS store and let them know something will be dropped off for them. They're charged $5 for it.

    Now, I'm not a rocket science major but would it not be easier to contract with the UPS store (since they make about $5 on these pickups) that say we'll make the recommendation TO the customer they have it shipped to a UPS store and have it picked up there? Then every referral made in this way UPS gets, lets say, .25 cents or something out of?

    This does a lot of different things for the company:

    1. It adds to our profit
    2. It makes us seem like a 'nice' company to the UPS stores for giving them business
    3. It allows convenience for our customers
    4. It allows convenience to our drivers. The UPS store routes will have a bit more bulk but they're going there anyways!